Voice of the Industry

Stanley Harmsen van der Vliet, INFORM: "RiskShield: Match the payment authentication process with the consumers risk profile"

Thursday 15 May 2014 11:00 CET | Editor: Melisande Mual | Voice of the industry

Banks should not close their eyes to alternative ecommerce security that also meet the ever-changing needs of the consumer

Stanley Harmsen van der Vliet is product marketing manager for RiskShield, a multichannel fraud prevention solution from INFORM GmbH. Stan is specialized in compliance and anti-fraud solutions and has been working in this market for more than 8 years. Stan’s career started in the banking sector where he worked for 10 years in the International Cash Management and Payments arena, first as product manager electronic banking and later representing ABN AMRO in several industry groups and e-payment forums.

It must be an odd feeling: always being one, or a few steps behind. Fighting fraud can be achieved by implementing additional safety measures; but the cost of these measures is high for the payment providers and they don´t always deliver consumers the perfect online experience. So, it might be better to adapt to this and implement security measures that keep costs down and truly help consumers make safer payments. The overload of payment verification tools and processes feels like an extra layer of inconvenience to consumers and they can hardly be seen as a help in executing a payment for eCommerce platforms such as Amazon, John Lewis, Ikea or Zalando.

Risk-based authentication opportunities

Banks and credit card companies do, of course, have good reasons for implementing these security authentication measures as they do help to reduce Internet fraud. But they should not close their eyes to alternative ecommerce security and authentication solutions that also meet the ever-changing needs of the consumer. There are better ways of providing consumers with a far more satisfying online and mobile shopping experience: Card issuing banks and card service providers should adopt tools that offer differentiating possibilities, such that a consumer with a high risk will still betaken through the strict security steps and those with a lower risk profile will be able to progress with a much ‘lighter’ security process. This approach maintains the stringent security at the high end of the risk scale, but at the same time, fast-tracks the lower risk consumers giving a far better experience for the majority.

Lower cost, higher revenue and enhanced consumer satisfaction

By differentiating the payment method and security steps to individual customers, based on a shoppers’ buying behaviour and transaction history, both issuers, acquires and online merchants can benefit from better results. The majority of customers (and their computers) can be trusted; they simply want to purchase an e-book, a flight or shoes. About 90-95 percent of all transactions fit within the low risk profile. There is really no point in demanding that all consumers fulfil all high security steps required in a complete authentication process. By implementing the right solution: payment service providers will save costs; online shops will benefit from higher revenues; and the majority of consumers will be far happier and more likely to complete their transaction.

INFORM develops and markets software systems to optimize business processes on the basis of operations research and fuzzy logic. INFORM Risk & Fraud division is specialized in fraud prevention and provides a high performance multi-channel fraud detection and risk assessment solution that helps banks, acquires, issuers and PSPs mitigating payment risk and avoid chargebacks. RiskShield prevent fraud losses and increase customer confidence with the most adaptive and fastest deployable anti-fraud software in the market today.

More than 1000 companies worldwide benefit from advanced optimization software systems by INFORM in industries such as transport logistics, airport resource management, production planning, financial crime risk management and insurance claims handling optimization. INFORM employs over 500 staff from more than 30 countries.

To learn more about risk-based authentication (RBA), read our article at http://goo.gl/IQxGce or contact us at riskshield@inform-software.com, tel: +49 2408 9456 5000

Further information about RiskShield can also be found at: www.riskshield.com

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Keywords: Inform, RiskShield, payment authentication, online fraud, online security
Countries: World

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